Study highlights spending gaps at NCAA schools

Study highlights spending gaps at NCAA schools

January 16th, 2013by Associated Press in Local - Breaking News

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Annual spending on sports by public universities in six big-time conferences like the SEC and Big 12 has passed $100,000 per athlete - about six to 12 times the amount those universities are spending per student on academics, according to a study released today to greet college presidents arriving at the NCAA's annual meeting in Texas.

The study finds the largest gap by far in the SEC, which combines relatively low academic spending and explosive coaching salaries.

Median athletic spending there totaled nearly $164,000 per athlete in 2010. That's more than 12 times the $13,390 that SEC schools spent per student for academic expenses, including instructional costs and student services.

The schools of the Pac-10 (now the Pac 12), ACC, Big Ten and Big East also averaged six-figure spending per student athlete in 2010, the study finds. Across Division I, athletic spending - though still smaller in absolute terms - rose twice as fast as academic spending between 2005 and 2010. During that period, the schools competing in the top-level Football Bowl Subdivision of the NCAA upped their athletic expenditures on average $6,200 per athlete each year, according to data compiled by the Delta Cost Project at American Institutes for Research as part of an ongoing project with the pro-reform Knight Commission on Intercollegiate Athletics.

The report does not provide information about ratios at individual institutions.

Overall, FBS schools spent on average $92,000 per athlete in 2010, or just under seven times what they were spending per student on academics at a time of falling state funding for higher education in much of the country, and tuition increases widely outpacing inflation. The report did find, however, the growth rate seemed to be slowing.

The figures likely won't shock college presidents arriving in Grapevine, Texas, for the NCAA convention, but they will highlight their rising concern over out-of-control spending on intercollegiate athletics that threatens to sink budgets and compromise their academic missions. Some want the NCAA to do more to address the issue even if it can't legally limit salaries.

"How many sport video analysts do you really need?" said John Dunn, president of Western Michigan University, who gave a talk Tuesday at a preliminary portion of the meeting on rising inequality in college athletics. "How many assistants for a coach - not assistant coaches, [but] assistant office personnel, to keep his life straight?"

"While the NCAA wants to avoid being overly intrusive, they have never had a problem saying there should be x number of coaches and x number of scholarships awarded," he said. "Why not also govern how many ancillary personnel you can have?"

NCAA spokesman Erik Christianson said in a brief emailed statement that colleges make their own spending decisions and "are reluctant to cede authority over their budgets to the NCAA." Two spokesmen for the SEC did not respond to phone messages and emails seeking comment.

The conceit of the study - comparing per capita spending on athletes versus academic spending - carries some caveats. Universities already "spend" widely varying amounts on different types of students; those in majors requiring special equipment, or offering small classes, already benefit from more spending, as might those signing up for extra-curriculars or special tutoring.

Knight Commission Executive Director Amy Perko said her group realizes at many institutions athletic spending per athlete will inevitably be higher than academic spending per student.

Also, "academic spending" can be a confusing category, though the study uses federal data universities must report under a precise methodology. While it includes athletic scholarships as athletic spending, for example, institutional financial aid available to other students doesn't count as "academic spending."

Still, the size of the ratios - and the fact that six conferences have broken six figures, up from four a year before - are eye-catching data points showing the extent to which Division I college athletics programs have come to inhabit separate financial universes from the academic institutions whose names they share.

Perko said it's the growing subsidies most universities kick in to cover athletic department budgets that are especially alarming. The Knight Commission has been pushing for the NCAA to incentivize institutions to stay within certain ratios of athletic-to-academic spending, to no avail. The BCS, which is organizing the new college football playoff system separately from the NCAA, has committed to tying 10 percent of the lucrative payout from the new BCS playoff system to academic benchmarks, Perko said, but she wants more done.

While new TV deals will produce more revenue, they will also likely exacerbate inequality. If adopted, recent proposals to pay athletes a stipend would also fuel spending by athletic departments, as could the increased travel required by recent conference re-alignments.

Many big spenders like the SEC schools also have the most revenue to cover those costs. A few dozen or so actually turn a profit on their athletic departments, and on average the top half of FBS programs get by on a modest university subsidy, averaging between $3 million and $6 million. But schools in the bottom half of FBS rely on much bigger subsidies from the academic side to fund athletics. That money often comes from student fees paid by non-athletes. At those schools, the subsidies now total $11 million to $14 million annually, the study found.

"The data that really jumps are out are the serious financial divides among the 300-plus Division I schools with regard to where their money comes from," Perko said. "Those differences are really causing the Division I model to really rip apart at the seams."

But even at big-name schools, financial pressures are mounting. The University of Maryland recently bolted the ACC for the Big Ten in hopes the Big Ten could help it staunch multi-million dollar annual losses in its athletic program. The University of Tennessee's athletic department recently discontinued an annual $6 million contribution the athletic department had been sending back to the university - even as it hired a new football coach, Butch Jones, at more than $3 million annually.

Dunn says what's most alarming is the gap within conferences, not between them. Western Michigan competes in the Mid-American Conference, where he said spending ranges from about $19 million to $28 million, keeping the conference competitive (WMU has to subsidize about half its athletic budget). But in conferences like the Big 12, the gap between relatively low spenders like Iowa State and Kansas State, and mammoth programs like Texas and Oklahoma, is now around $100 million. Such gaps create big incentives to cut corners.

"It's a great deal of pressure, because people want to win," he said.

The new study does not include data on private institutions, though there are only a handful in the top FBS conferences. The SEC, for instance, has just one private university: Vanderbilt.

A big driver in athletic spending has been the growth in coaching salaries and the size of athletic department staff, with compensation accounting for about one-third of athletics expenditures across the FBS. Nowhere is that on more vivid display than the SEC, which has produced the last seven BCS national football champions.

Nick Saban, whose Alabama team has won three of the last four, earned $5.32 million in 2012, but every conference football coach now earns at least $2 million. Already this off-season, four losing conference programs - Tennessee, Kentucky, Auburn and Arkansas - have hired new coaches at annual salaries of between $2.2 million and $3.2 million. The University of Mississippi's Hugh Freeze, the conference's lowest-paid coach, got a $500,000 raise to $2 million, a 10 percent raise for his assistants, and a $12.5 million upgrade to practice facilities.

According to the College Board, the average financial aid package at Mississippi meets just 77 percent of student need, and just 57 percent at Alabama.